Standard : Technical Debt Ratio

Description

Technical Debt Ratio quantifies the cost of fixing maintainability issues compared to the cost of building the system. It reflects how much extra effort is needed to extend, maintain, or refactor a system due to shortcuts or outdated practices.

This ratio provides a tangible measure of architectural health and helps prioritise investments in code quality and sustainability. It is often calculated using static analysis tools and supports ongoing engineering decision-making.

How to Use

What to Measure

  • Compare the time or effort required to fix all maintainability issues vs. the estimated effort to build the same functionality from scratch.

Formula (SonarQube style)

Technical Debt Ratio = (Remediation Cost / Development Cost) x 100

Instrumentation Tips

  • Use tools like SonarQube, Code Climate, or CAST to automate calculation.
  • Track across services, teams, or repositories to spot hotspots.
  • Visualise as a percentage and trend over time.

Why It Matters

  • Visibility: Makes invisible complexity visible and actionable.
  • Sustainability: Supports long-term maintainability and adaptability.
  • Prioritisation: Informs decisions about refactoring vs. building new features.
  • Team health: High debt slows teams down and increases frustration.

Best Practices

  • Review technical debt ratio regularly in team or architecture reviews.
  • Tag debt remediation tasks in your backlog for visibility and prioritisation.
  • Balance debt reduction with feature delivery using investment thresholds.
  • Track both global and local (file/module-level) debt indicators.
  • Combine with business metrics to show impact on time-to-market or quality.

Common Pitfalls

  • Treating all debt as equal—focus on high-impact areas.
  • Ignoring test and infra debt in ratio calculations.
  • Letting tools define priorities without team input.
  • Not tracking the outcomes of remediation work.

Signals of Success

  • Debt ratio stabilises or decreases over time, especially in key systems.
  • Engineers proactively log and address debt items.
  • Refactoring is scheduled and celebrated, not treated as overhead.
  • Product and engineering jointly understand the cost of inaction.
  • [[Code Churn]]
  • [[Defect Escape Rate]]
  • [[Change Failure Rate]]
  • [[Refactoring Activity]]
  • [[Code Quality Score]]